Interview with Jerry. Good Read.
What Makes Jerry Run?
Forbes ASAP interviews Silicon Valley's Mr. Chips: Jerry Sanders, CEO of
AMD
By Michael S. Malone
Walter Jeremiah Sanders III is the last man standing.
Of the original Fairchildren, the extraordinary group of young men who walked
out of Fairchild Semiconductor more than 30 years ago to found Silicon Valley,
only Jerry Sanders still runs a major chip company. Sanders was the wildest and
perhaps the most clever of them all.
But the slick young salesman who had tooled around in a Bentley convertible,
lived in a house he couldn't afford in the Hollywood hills, and, according to
legend, wore pink pants on a sales call to straitlaced IBM is now 63 years
old--a grand old man of high tech.
As effortless as he has tried to make it look, nothing has ever come easily for
Sanders. He has taken the most difficult path imaginable. For more than three
decades, through seven product generations and one of the nastiest lawsuits in
high tech history, Sanders has led his company, Advanced Micro Devices, into
war against Intel, one of the most successful firms on the planet.
In March, AMD introduced its latest torpedo aimed at Intel, the 1-gigahertz
Athlon microprocessor. It is Sanders' greatest play, and once again, he is
betting it all. Forbes ASAP Editor Michael S. Malone, as part of a
soon-to-be-aired PBS television series on entrepreneurs, sat down with a tired
but still razor-sharp Sanders to talk about his life and what will likely be his last
great campaign.
ASAP: It seems as if you're trapped in entrepreneurial hell. Twenty-five years
ago you started AMD; 15 years ago you were still in startup mode, competing
against Intel, and now you're still, in many ways, an entrepreneurial upstart.
SANDERS: Well, it's an interesting observation. I guess the first thing I'd say is,
you know, we're a $2.5 billion to $3 billion company. So that doesn't quite feel
like an entrepreneurial startup when I see companies which have no revenues,
or little or no revenues, and they consider themselves entrepreneurs. Here we
are, a $2.5 billion to $3 billion company, and yet you're right. There's a certain
kind of entrepreneurial quality about AMD. I hope there always will be.
ASAP: Have you ever taken the time to stop and enjoy your successes?
SANDERS: No, actually, I missed that opportunity. I had the chance. We'd been
engaged in legal battles with Intel from about '86 to '94 when we won the
microcode case, and we also won the arbitration. In a three-year period, AMD
made over a billion dollars in operating profit. And I was very proud of that
billion dollars. But always over my head was the sword of Damocles, that if we
lost the court case, AMD was history. So there was tenseness, a tautness in
my stomach through all those good years. Even though we were making a billion
dollars, I couldn't enjoy the good times.
When we won the case and that threat was gone, I took on the incredibly
ambitious task of building an alternative to the Intel monopoly. So for the past
five years, it's been like a startup hell, because we've done every conceivable
thing: We've built factories. We've developed leading-edge technology. We've
acquired a company to fill a hole we had in our product road map.
ASAP: And now you're betting the store again. Is this the last roll?
SANDERS: In order to build an alternative platform to the Intel monopoly, we
had to have independent products which were different than Intel's but still
executed all the software under the Microsoft operating systems. No one else
has been able to do it. In the 1980s, there were 15 licensed Intel alternatives
for x86 instruction-set microprocessors. We're the last man standing.
ASAP: What keeps you going? Most of your peers, if they had looked at you 25
years ago, would have said, "By now, Jerry's going to be in Beverly Hills, having
the time of his life."
SANDERS: The reality is that there's a part of me which is duty driven. And I
am determined to fulfill my dream at AMD.
ASAP: Where did that come from? Where does that sense of duty come from?
SANDERS: I think it came from my upbringing in Chicago. My grandfather and
my grandmother were good, God-fearing people. My grandfather had a great
belief that good things only came from hard work, for the average person.
He told me if I didn't go to college, I was worth less than dirt. He didn't care
what I studied in school as long as it was something I could make a living at.
His definition of making a living was to be an engineer: "You can get a job. You
can make money. You can survive, and you won't be a drag on me as you have
been for the entire 21 years of your life."
When I graduated from college, no one came to my graduation. And when I
came home, my grandfather presented me with a bill. It was a listing of all of
the canned goods I used, charges for the laundry my grandmother had done for
me, which I used to send home from college. This is how much he felt I owed
him, and he hoped I would pay it back when I was able.
ASAP: How bitter did this make you?
SANDERS: It made me laugh because it was just so outrageous. How could my
grandfather do that? I knew in his own way he loved me. I knew he was proud
of me. And I think what I was most impressed with was, he kept such
meticulous records. [Laughter] I thought, "God, he's not even a Virgo."
ASAP: During this time, there was a major turning point in your life, when you
were almost killed.
SANDERS: A few years ago, I was in Hong Kong and took the time to go to one
of these fortune-tellers, and he told me that I had two lifelines. One of them
went on for a very long time, but the other lifeline ended when I was 18.
When I was 18 I had last rites. I was home from college, and I went to a party
that was unfortunately dominated by a gang. The gang's name was the Chi
Nine, which obviously stands for the Chicago Nine. And I didn't know anything
about the Chi Nine, but one of the guys I was with had a high degree of
interest in a girl who was at the party, who happened to be presumably the
property of the leader of the Chi Nine.
And this guy--I'm never going to forget his name, Bob Biocek--decided he was
going to fight my friend. My friend went outside, and they started fighting. It
wasn't going particularly well for either of them. So Bob Biocek, the gang
leader, decided to have his friends help him finish off my friend.
I jumped in to help my friend. I really thought that we could make a difference.
And to my surprise, my friend ran off and escaped and left me there, and these
guys decided, well, I was the next best thing. So they did me up pretty well.
They broke my nose, fractured my skull, kicked in my ribs, carved me up with a
beer can. Fortunately, I had a coat on so it didn't make any lasting scars on my
back. Then they dumped me in a garbage can, which I thought was a pretty
nasty thing to do. I look back now, it's amazing I survived. They put me in the
emergency ward, and to make a long story short, they gave me last rites. But a
few days later, I came out of the coma.
ASAP: This sounds like a fundamental turning point in your life.
SANDERS: What I remember most about that was that I'd been betrayed by a
friend. And he wasn't my best friend. He wasn't even a guy I knew that well.
But I'd gone to help him. And my reward for that was, he let me down...big
time.
I saw him afterwards. He told me he had a broken jaw from a football injury,
and his jaw was wired, and if he'd stuck around he could have really been hurt.
I thought, "This is just ridiculous. I went to your aid, and you betrayed me."
So it taught me a couple of things. One, it taught me maybe you shouldn't
always count on people that you don't know. That's where this character thing
comes in. This guy showed no character whatsoever.
And the other thing it taught me is that life isn't fair. I've dedicated myself to
being an advocate of fairness.
ASAP: So did the process make you more optimistic in your life?
SANDERS: I think I've always been kind of optimistic. I'm a great believer in the
American dream. I'm kind of a mongrel. I'm Swedish, Scotch, Irish, and German.
All my ancestors were immigrants--a general contractor from Sweden, a laborer
from Ireland. And they all came to America to make a better life, where nothing
is impossible if you put enough energy and effort into it. So I've always had
that belief.
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